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Jobless in Chennai
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Job seekers and the employed in Chennai are going through a tough time due to downsizing, salary cuts and the dotcom crash. Is this a temporary blip? Read on...
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To use Queen Elizabeth's famous phrase, last year was truly annus horribilis for job seekers and the employed in Chennai. Everybody will know somebody who has taken VRS (voluntary retirement scheme), some young person who has received the pink slip (who ever heard of pink slips 10 years ago), and some young hopeful, straight out of college, who is finding it impossible to get a job. Many software companies have imposed salary cuts of about 30 per cent. It is common to hear that salaries have not been paid for two or three months. Are things really getting grim in this city of ours? Is the economic slowdown bringing the job market to a standstill?
According to a survey done by the city-based Ma Foi Management Consultants, a large HR company, which tracked 10 cities and 12 industries, Delhi emerged as number one in terms of job creation last calendar year. Hyderabad and Pune took the next place. Bangalore dropped to four. Chennai which was considered a most happening city till recently, actually finished fifth. If it is any consolation, Mumbai, our commercial capital, has done even worse with getting the sixth place. Trailing behind are cities like Baroda, Chandigarh and Ahmedabad.
How did this happen? Many analysts think that the political uncertainty of the past few months has made investors who would have considered Chennai, either postpone their decisions or go away to Bangalore or Hyderabad. They feel more welcome in these cities. Remember those exciting times in Tamil Nadu when automobile giants Ford and Hyundai decided to set up shop in Chennai. Mitsubishi moved in with the manufacture of Lancer. French giant SaintGobain put up a plant to make glass, and the Tidel Park was built in record time to house the IT companies, which were raring to go. Somehow this kind of buzz seems to have momentarily disappeared. Says Pandiarajan, MD, Ma Foi, "IT enabled services, insurance, healthcare, telecom, life sciences, biotech and auto and auto components actually performed well and created new jobs." The survey shows that although jobs were there Chennai did not get a large share of the pie. For instance, while Hyderabad and Bangalore surged ahead in the biotech and life sciences area, there was not a single project coming up in Chennai.
In those golden days, numbers didn't matter. Salaries were low. There was no competition. You sold whatever you made. Jobs were not dependent on global trends. The Nineties have changed all that. Now the new mantra is be lean and mean and fit. As a result, many companies which are identified with the old economy have been quietly downsizing in the last two or three years. Ashok Leyland has reduced its workforce by 1,000 in the recent past. They are planning a reduction of another 700. The big auto component units in and around Chennai have also been cutting down on the excess flab. Says a senior professional from the engineering industry, ``We follow global standards now. We have to aim for sales of Rs. 50 to 60 lakhs from an employee. Good Indian companies have achieved a figure of Rs. 20 lakhs. But the average figure still remains at Rs. two lakhs."
The newcomers like Ford and Hyundai do not necessarily fill the gap. With automated manufacturing operations, their manpower need is not so high. Hindustan Motors, which makes the old war horse Ambassador, would have hired 7,000 workers 20 years ago. Ford does not need more than 700. World over, when new technologies replace old ones, new opportunities are created. But this has not yet happened here.
The IT industry was supposed to absorb a whole lot of bright youngsters. To a certain extent it did happen two years ago. The short-lived dotcom boom created a short-lived golden period. "Any body who learnt the rudiments of computer languages like Java could be absorbed," says Mr. Pandiarajan. With the dotcom crash, many dreams have been shattered. Chennai was a loser last year even in IT enabled services although the Ma Foi survey shows that the city offers the highest availability of technical skills in this field at a reasonable cost.
All is not lost. Most industry observers feel that this slowdown in the job market could be a temporary blip. Although frenetic recruiters Pentasoft Technologies and DSQ have fallen flat on their faces, big time IT companies like TCS, Cognizant Technologies and Infosys never stopped hiring. TCS added on 1,000 people last year in Chennai. The medium sized ones in the Tidel Park are seeing the light at the end of the tunnel. Bharti and Reliance are going to increase their telecom activity in the State. The World Bank has announced that it is going to move its backend operations to Chennai. The Chief Minister has said she is going to make Tamil Nadu the number one State again. If the all important feel good factor is created once again, better times will follow.
SUSHEELA
RAVINDRANATH
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